Impact of Chinese, Korean and Japanese Innovation Spillover on Labour Productivity in South African Manufacturing
Keywords:
Innovation spill over, labor productivity, manufacturing, South Africa
Abstract
Open economy endogenous growth theories consider physical intermediate imports as a channel through which innovation spreads across international boundaries. We build from this literature and contribute by considering trade in services as the channel through which innovation from China, Korea and Japan influences labour productivity in South Africa’s manufacturing sector between 1995Q1 – 2017Q4. Unlike previous studies, we also compute a composite innovation index using the principal component analysis. Results from the autoregressive distributed lag model are supportive of open economy endogenous growth theories for Japan and Korea. However, for China, the effect is significantly negative adding further concerns over its predatory presence in South Africa.
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References
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Pesaran, M. H. & Smith, R. P. (1998). Structural analysis of co integrating VARS. Journal of Economic Surveys, 12(5), 471-505. Pesaran, M. H., Shin, Y. & Smith, R. J. (2001). Bounds Testing Approaches to the Analysis of Level Relationships. Journal of Applied Econometrics, 16(3), 289-326. Piermartini, R. & RubÃnová, S. (2014). Knowledge Spill Over Through International Supply Chains (No. ERSD2014-11). WTO Staff Working Paper. Potterie, B. V. P. D. L. & Lichtenberg, F. (2001). Does Foreign Direct Investment Transfer Technology Across Borders? Review of Economics and Statistics, 83(3), 490-497. Pradeep, V., Bhattacharya, M. & Chen, J. R. (2017). Spillover Effects of Research and Development, Exports and Foreign Investment on Productivity: Empirical Evidence from Indian Manufacturing. Journal of South Asian Development, 12(1), 18-41. Raouf Abdel Fattah, E. (2015). Total Factor Productivity and Technology Spillover in Egypt. Middle East Development Journal, 7(2), 149-159. Renard, M. F. (2011). China’s Trade and FDI in Africa. China and Africa: An emerging partnership for development, 25. Romer, P. M. (1989). Increasing Returns and New Developments in the Theory of Growth (No. w3098). National Bureau of Economic Research. Roquia Fane Madouka Koumou, Wang Manyi. (2016). Effects of Chinese Foreign Direct Investment in Africa. Journal of Finance and Accounting, 4(3), 131-139. Schmookler, J. (1966). Invention and Economic Growth, Cambridge, MA; Harvard University Press. Stock, J. H. & Watson, M. W. (1993). A Simple Estimator of Cointegrating Vectors in Higher Order Integrated Systems. Econometrica: Journal of the Econometric Society, 783-820. Park, J. Y. (1992). Canonical Cointegrating Regressions. Econometrica: Journal of the Econometric Society, 119-143. Phillips, P. C. & Hansen, B. E. (1990). Statistical Inference in Instrumental Variables Regression with I (1) Processes. The Review of Economic Studies, 57(1), 99-125. Terleckyj, H. (1974). Effects of R&D on the Productivity Growth of Industries: An Exploratory National Planning Association, Washington, D.C.
Published
2018-11-03
How to Cite
Mazorodze, B. T., & Tewari, D. D. (2018). Impact of Chinese, Korean and Japanese Innovation Spillover on Labour Productivity in South African Manufacturing. Journal of Economics and Behavioral Studies, 10(5(J), 16-28. https://doi.org/10.22610/jebs.v10i5(J).2494
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Copyright (c) 2018 Brian Tavonga Mazorodze, Devi Datt Tewari
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